Leveraged Buyout Firms Use the Unencumbered Assets and Operating Cash

question 44

True/False

Leveraged buyout firms use the unencumbered assets and operating cash flow of the target firm to finance the transaction.

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Definitions:

GDP

Gross Domestic Product, the total value of all goods and services produced within a country's borders, serving as a broad measure of economic activity.

Depreciation

is an accounting method of allocating the cost of a tangible asset over its useful life to account for declines in value.

Net Domestic Product

The total value of all finished goods and services produced within a country’s borders in a specific time period, after accounting for depreciation.

Per Capita GDP

A measurement that represents the gross domestic product (GDP) per person within a country, providing a per capita average of national economic output and wealth.